Q.What should be the annual rate of simple interest so that the interest for 5 years becomes \(\frac{1}{4}\) of the principal?

Let the principal \((p) = x\) rupees \(\therefore\) Total interest \((I) = \cfrac{x}{4}\) rupees Time \((t) = 5\) years \(\therefore\) Rate of interest \((r) = \cfrac{100 \times I}{p \times t}\%\) \[ = \cfrac{100 \times \cfrac{x}{4}}{x \times 5}\% = \cfrac{100}{4 \times 5}\% = 5\% \] \(\therefore\) The rate of interest will be 5%
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